Xerox (NASDAQ:XRX) Issues Quarterly Earnings Results

Xerox (NASDAQ:XRX) posted its earnings results on Thursday. The information technology services provider reported $0.02 EPS for the quarter, topping the consensus estimate of ($0.07) by $0.09, FiscalAI reports. Xerox had a negative net margin of 15.40% and a positive return on equity of 53.07%. The firm had revenue of $1.87 billion during the quarter. During the same period in the prior year, the business posted $0.20 earnings per share. The company’s revenue for the quarter was down 4.7% on a year-over-year basis.

Here are the key takeaways from Xerox’s conference call:

• Xerox lowered 2026 adjusted operating income guidance to $450–$475 million from $555–$605 million and cut free cash flow guidance to $50–$100 million from approximately $250 million. The company cited higher memory, oil and tariff-related costs, unfavorable equipment mix, weaker print-market demand and IT Solutions underperformance.
• The board suspended common and preferred dividends, preserving approximately $28 million in annual cash for liquidity and debt reduction. Year-end gross leverage is now expected at about 5.6x, versus the prior target of below 5x, extending the timeline for deleveraging.
• Print trends improved, with Q3 equipment revenue rising 3% organically—the first year-over-year growth in more than three years—and installs increasing 9%. Entry and production equipment growth offset mid-range declines, leading management to believe Xerox gained market share.
• IT Solutions revenue declined 17% year over year and segment margin fell to 4.4%, as slower sales-force ramp-up, delayed customer decisions and tighter supplier terms reduced conversion. Management expects improvement in Q4 but acknowledged that the business requires further work.
• Xerox announced a debt exchange covering approximately $174 million of 2028 notes, reducing total debt by about $53 million and extending nearly one-third of those maturities to 2030. Management also highlighted roughly $100 million of incremental Lexmark synergies expected in 2027, alongside additional pricing and cost-reduction initiatives.

Xerox Price Performance

Shares of NASDAQ XRX opened at $1.47 on Friday. Xerox has a fifty-two week low of $1.19 and a fifty-two week high of $3.78. The company has a 50 day simple moving average of $2.98 and a two-hundred day simple moving average of $2.53. The company has a market capitalization of $192.38 million, a price-to-earnings ratio of -0.16 and a beta of 2.45. The company has a debt-to-equity ratio of 12.58, a quick ratio of 0.85 and a current ratio of 1.14.

Xerox Announces Dividend

The firm also recently disclosed a quarterly dividend, which was paid on Friday, October 30th. Shareholders of record on Wednesday, September 30th were issued a $0.0250 dividend. This represents a $0.10 dividend on an annualized basis and a yield of 6.8%. The ex-dividend date was Wednesday, September 30th. Xerox’s dividend payout ratio is -1.10%.

Key Xerox News

Here are the key news stories impacting Xerox this week:

• Positive Sentiment: Third-quarter results exceeded estimates. Xerox reported adjusted earnings of approximately $0.06 per share, versus consensus expectations for a $0.07 loss, while revenue of about $1.87 billion was broadly ahead of estimates. However, revenue still declined 4.7% from the prior year. Xerox Q3 Earnings and Revenues Surpass Estimates
• Positive Sentiment: Debt-reduction measures provide some balance-sheet support. Xerox announced an exchange transaction covering roughly $174 million of 2028 senior notes, extending maturities to 2030 and reducing debt principal by about $53 million while preserving cash. Xerox Debt Exchange Transaction
• Neutral Sentiment: Strategic pressure is increasing. STARTEEPO, Xerox’s third-largest shareholder with a 7.34% stake in shares and options, supported debt-reduction efforts but urged the board to consider strategic alternatives for Xerox Financial Services and the broader company. STARTEEPO Comments on Xerox Results
• Negative Sentiment: Profit and cash-flow forecasts were reduced. Xerox lowered its 2026 adjusted operating-income outlook to approximately $450 million-$475 million, a reduction of up to $130 million only three months after raising guidance. The company also cut its free-cash-flow forecast, citing higher costs, weaker cash generation and other operating headwinds, although it maintained its full-year revenue outlook.
• Negative Sentiment: The dividend suspension and legal investigations worsen sentiment. Xerox’s board suspended its dividend as it prioritizes liquidity and debt reduction. Multiple law firms also announced investigations into whether investors received materially misleading information, adding potential legal and reputational risk. Rosen Xerox Investigation

Wall Street Analyst Weigh In

Several analysts have commented on XRX shares. Needham & Company LLC set a $5.00 price objective on shares of Xerox in a report on Tuesday, August 18th. Weiss Ratings reissued a “sell (d-)” rating on shares of Xerox in a research report on Thursday, October 22nd. Citigroup lowered their target price on Xerox from $2.50 to $1.50 and set a “sell” rating for the company in a research note on Friday. Finally, Noble Financial initiated coverage on Xerox in a research report on Tuesday, August 18th. They set an “outperform” rating and a $5.00 price target on the stock. One equities research analyst has rated the stock with a Buy rating, one has assigned a Hold rating and two have given a Sell rating to the stock. According to data from MarketBeat.com, Xerox presently has an average rating of “Reduce” and a consensus target price of $3.83.

Institutional Trading of Xerox

A number of hedge funds have recently made changes to their positions in XRX. Integrated Wealth Concepts LLC bought a new position in shares of Xerox during the second quarter valued at $28,000. Sowell Financial Services LLC purchased a new stake in Xerox during the 3rd quarter valued at about $34,000. Great Lakes Advisors LLC purchased a new stake in Xerox during the 2nd quarter valued at about $45,000. Chicago Partners Investment Group LLC bought a new stake in Xerox during the 1st quarter valued at about $25,000. Finally, Vontobel Holding Ltd. increased its stake in Xerox by 41.5% during the 3rd quarter. Vontobel Holding Ltd. now owns 22,840 shares of the information technology services provider’s stock valued at $72,000 after purchasing an additional 6,700 shares in the last quarter. 85.36% of the stock is owned by institutional investors.

About Xerox

Xerox Holdings Corporation (NASDAQ:XRX) is a technology and workplace solutions company that provides printing, document management and digital services to businesses and other organizations. The company serves customers across a range of industries, including government, education, healthcare, financial services and professional services.

Xerox offers office printers, multifunction devices, production printers and related supplies, software and support services. Its portfolio also includes document workflow and content-management solutions designed to help organizations digitize, automate and manage business processes.